Temple & Webster bucks the trend with strong sales growth into Christmas
The boss of the online home furnishings retailer has declared Black Friday the ‘new Christmas’ with a hugely successful campaign that saw sales double.
Online home furnishings retailer Temple & Webster has bucked the sombre and downbeat trend of the sector to report double-digit sales growth for the second quarter and a hugely successful Black Friday sales campaign that saw a 100 per cent sales leap.
Temple & Webster chief executive Mark Coulter told The Australian on Wednesday before the company’s annual general meeting the Black Friday-Cyber Monday trading period was the ‘new Christmas’ as shoppers brought forward their gifting purchases.
Such was the huge demand for lamps, tables, chairs, bedding and other home furnishings, the company posted a 101 per cent increase in sales to $17.4m for the four-day period from the recent Black Friday-Cyber Monday sales campaign, with it also hitting multiple record days of sales.
“Yes, we are definitely bucking the trend,” Mr Coulter said reflecting on Temple & Webster’s upbeat sales performance.
“November is the new December, people are doing their Christmas shopping early and they are taking advantage of the strong promotional period in November. Every year we see it (Black Friday-Cyber Monday) getting stronger and stronger. This year is no exception.
“If they do their shopping in November they can ensure it gets delivered in time for Christmas, so it’s good for them and it’s great for us as an online-only retailer. Obviously, as we get close to Christmas people get worried about shipping but if they do the shopping in November, that’s great for us.”
Shares in Temple & Webster rocketed 15 per cent to $7.42 in morning trade as the market reacted to the bullish trading update.
The Australian Retailers Association has predicted a strong Black Friday sales period for the nation’s $400bn retail sector, forecasting total sales across the four days to lift 3 per cent to $6.36bn.
Temple & Webster, whose shares rallied hard through the Covid-19 pandemic as people stuck at home filled their homes with comfy chairs, cushions and ornaments, has also had a strong lead into Black Friday and Christmas as its sales growth accelerates to almost 50 per cent.
At the AGM Mr Coulter provided a trading update that revealed Temple & Webster was bucking the trend of other retailers reporting diving sales growth, reporting sales were up 23 per cent from 1 July to 27 November. He told shareholders the second quarter had seen an acceleration of growth with revenue up 42 per cent year on year for the period of 1 October to 27 November.
This was partly driven by Temple & Webster upping its advertising across television, billboards and other platforms outside of its traditional online marketing channels.
It stands in stark contrast to other discretionary retailers like the nation’s largest footwear seller Accent Group, home furnishings chain Adairs, Country Road, Harvey Norman, candles retailer Dusk and jewellery chain Lovisa, which have posted sliding sales as consumers rein in their spending to cope with cost of living pressures.
“I think the reason why we are doing well and growing market share in an environment like this is that we are really executing the strategy which we’ve had for a long time now,” Mr Coulter said.
“And that is make sure our range is really great, high quality, affordable prices — and that kind of position or great quality at great prices is resonating and people are feeling the pinch, cost of living is going up whether you are a renter or a mortgage holder you are still feeling poorer.”
He said Australian customers were feeling poorer and this showed in the price points that performed well as shoppers looked for value.
“Interest rates may still go up, there is still a housing shortage, there are inflationary pressures everywhere, so I don’t think we are out of the woods yet.
“As we progress into fiscal 2024, we understand that the macroeconomic turbulence of the past 12 months isn’t in the rear-view mirror yet. However, we are well positioned to manage these headwinds and believe this environment provides us with an opportunity to gain market share faster and more efficiently as less well-capitalised peers struggle with market conditions.”
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